Government Pension Offset (GPO)

This is a law that affects spouses and widows or widowers.

If you receive a pension from a federal, state or local government based on work where you did not pay Social Security taxes, your Social Security spouse’s or widow’s or widower’s benefits may be reduced.  The following information will answer your questions about the government pension offset reduction.

How much will Social Security reduce your benefits?

Social Security will reduce your benefit by two-thirds of your government pension.

Example:  If you get a monthly government pension of $900 a month, your benefit will be reduced by $600 (two-thirds of $900.)  If your Social Security widow’s monthly benefit is $1000.  Social Security will reduce this benefit by $600, and pay you  $400 per month.

If you take your government pension annuity in a lump sum, Social Security still will calculate the reduction as if you chose to get monthly benefit payments from your government work.

Why will Social Security reduce your benefit?

Benefits Social Security pays to spouses, widows and widowers are “dependent’s” benefits.  The law has always required that a person’s benefit as a spouse, widow, or widower be offset dollar for dollar by the amount of his or her own retirement benefit.

If a woman worked and earned her own $900 monthly Social Security retirement benefit, but she was also due a $500 wife’s benefit on her husband’s Social Security record, Social Security could not pay that $500 spouse’s benefit because her own Social Security benefit offset it.  $900 is more than $500 and there is a dollar for dollar offset.

Before the Government Pension Offset provision, if that same woman was a government employee who did not pay into Social Security and who earned a $900 government pension, there was no offset and Social Security paid the full $500 spouse’s benefit.

The law was enacted so spouse’s receiving a non-covered government pension would be treated similarly as spouses receiving their own Social Security retirement benefit.

Your Social Security benefit as a spouse, widow or widower will not be reduced if you:

  • Are receiving a government pension that is not based on your earnings or
  • Are a state or local employee whose government pension is based on a job where you were paying Social Security taxes on the last day of employment and your last day was before July 1, 2004 or
  • Are a state or local employee whose government pension is based on a job where you were paying Social Security taxes during the last five years of employment and your last day of employment was July 1, 2004, or later (Under certain conditions, fewer than five years may be required for people whose last day of employment falls between July 1, 2004, and March 2, 2009.) or
  • Are a federal employee, including Civil Service Offset employee, who pays Social Security taxes on your earnings (A Civil Service Offset employee is a federal employee who was rehired after December 31, 1983, following a break in service of more than 365 days and had five years of prior civil service retirement system coverage.) or
  • Are a federal employee who elected to switch from the Civil Service Retirement System to the Federal Employees’ Retirement System (FERS) on or before June 30, 1988. If you switched after that date, including during the open season from July 1, 1998, through December 31, 1998, you need five years under FERS to be exempt from the Government Pension Offset or
  • Received or were eligible to receive a government pension before December 1982 andmeet all the requirements for Social Security spouse’s benefits in effect in January 1977 or
  • Received or were eligible to receive a federal, state or local government pension before July 1, 1983, and were receiving one-half support from your spouse.

Can You Still Get Medicare?

Even if you do not receive cash benefits based as a spouse, you still can get Medicare at age 65 on your spouse’s record if you are not eligible for it on your own record.  However, most government employees do pay Medicare tax and are eligible for Medicare on their own record.

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